The long term objectives of this project continue to be to document and explain differences in strategy, structure and performance among multi-unit hospital systems. The specific aims of the project continue to be to analyze these differences among five voluntary and three investor-owned hospital systems actively participating in the research, and further to document differences in selected performance indicators among hospitals belonging to those eight hospital systems and comparison hospitals in their market areas. An extensive database of primary and secondary data on 600 system and 900 comparison hospitals has already been compiled and analyzed. During the third year of the grant, this database will be expanded to include more variables and to allow longitudinal analysis. Phase One data (1983-84) is available on environmental measures, hospital and corporate level strategy, organization structure, and all four performance criteria: financial performance, cost and productivity, quality of care, and the scope of services offered to the community. Preliminary findings on all performance indicators excect quality have been included in analyses available in the appendices to follow. Phase One quality of care variables are scheduled to be cleaned and included in analyses before the end of this second grant year. The second phase of this grant is critical to understanding the impact of Medicare prospective payment and third party payers' cost containment activities on the strategy, structure and performance of multi-unit hospital systems. Changes in strategy will be documented and related to changes in the performance indicators noted above. The extent to which ownership differences persist even after taking into account strategic and structural variables will be examined and the implications for public policy will be highlighted.